After an accident happens or a destructive natural calamity, the immediate possible source of finances for the needed medical treatment or for repair/replacement of damaged property is Insurance, a person means of protecting himself/herself from financial hardship in the event of a bad event, such as death, severe illness, disability, natural calamity and so forth.

Some individuals opt for higher benefits despite having to pay higher premium, knowing that a higher amount of benefits will be more advantageous when needs arise. Often, however, policy holders end up disappointed and feeling cheated as the amount of financial benefit Insurance providers often grant are much smaller than the amount of the policy that they purchased. In many other instances, Insurance firms find ways or use tactics that will enable them to either disapprove a claim or maliciously impede the processing of a claim.

These tactics employed by insurance providers is called bad faith – the act of deceiving another person by deliberately and maliciously refusing to honor a contractual obligation. Bad faith is a violation of the “implied covenant of good faith and fair dealing,” a law in many U.S. states that is suggested in insurance contracts. Violation of this covenant gives the policyholder the legal right to file a claims lawsuit against the insurance provider for breach of contract, as well as for tort claim.

As explained in one website, “The swath of devastation created as hurricanes cut through the Northeast has led to one of the most costly disaster zones in the history of our country, and thousands of Americans have only just begun to recover from the destruction and work towards rebuilding what was lost in these storms. Hurricane insurance is an essential component of many individuals’ recovery plans, and without the swift and effective payments they are entitled to under their policies, it may be virtually impossible to start the considerable rebuilding efforts required all across the coast.

Despite the faithfulness of policyholders in making their payments, some unscrupulous insurance companies may attempt to avoid their financial obligations in this time of crisis. Unfortunately, underpayments, delays in payments, and in some cases outright denials of legitimate claims are all too common.” (www.txinsuranceattorneys.com)

The violation of the trust placed by policyholders on insurers is enough to warrant any legal action against the latter and, if proven guilty of acts of bad faith, they can end up paying policyholders an amount higher than the face value of the policy. Insurers, though, should consider seeking the help of a highly-competent insurance bad faith lawyer for a firm ground in their legal fight with their insurance provider. This is due to the complexity of the law and the insurance policy, which may leave the policy holder more confused than clarified.